March 28, 2010 - April 3, 2010

April 02, 2010

Judy Richmond, a vice president and associate general counsel for the U.S. Chamber of Commerce, will manage the day-to-day operations of its five-person legal department after Steven Law, the Chamber's chief legal officer and general counsel, leaves next week.

Law is departing to become president and chief executive officer of American Crossroads, a new group that will raise money for Republican candidates. He was not available for an interview. J.P. Fielder, a spokesman for the Chamber, said Law's last day is next Tuesday.

As for filling the general counsel job permanently, Fielder said, "I think right now, Judy is handling it, and we'll see where it takes us from there."

Richmond, a graduate of George Washington University Law School, first joined the Chamber in 1977, according to a biography released by the Chamber. She was not available for an interview.

Law has been at the Chamber for three years. He is a former deputy secretary and chief of staff at the U.S. Department of Labor who has also been executive director of the National Republican Senatorial Committee and chief of staff to Sen. Mitch McConnell (R-Ky.). At the Chamber, he led the Workforce Freedom Initiative, an effort to stop passage of the union-backed Employee Free Choice Act and fight other labor-backed initiatives. The Chamber said Friday that Lisa Rickard, the president of the Institute for Legal Reform, will be in charge of the workforce initiative.

You could call it a potsticker of a mess if it weren't about egg rolls. A Texas egg roll maker is in legal hot water with the U.S. Department of Justice over how it makes its shrimp appetizers.

On April 1, DOJ sought a permanent injunction against Houston-based Chung’s Products, alleging the company prepared, packaged and sold shrimp egg rolls under unsanitary conditions, thus creating a potential safety hazard.

In USA v. Chung’s Products LP, which was filed in federal court in the Southern District of Texas, DOJ relied on a 2009 inspection by the U.S. Food and Drug Administration, which found that the company did not properly control for the risk of a certain toxin formation that can cause botulism, a potentially fatal disease. The inspection also found the presence of Listeria monocytogenes, which can cause listeriosis, a disease that can be fatal for the very young, the elderly and those with compromised immune systems.

"The agency has previously warned the company that corrective actions need to be taken in this facility," Michael Chappell, the FDA's acting associate commissioner for regulatory affairs, said in a statement. "This FDA action is aimed at protecting the public health."

The shrimp egg rolls produced by Chung's are sold across the country.

The lawsuit also named Charlie Kujawa, the company's president, and Gregory Birdsell, its director of quality assurance. Neither were immediately available for comment. The company has so far made no mention of the legal action on its Web site.

A federal appeals court in Washington will have the chance to examine the latest version of the District of Columbia's gun restrictions, in a possible test of how to apply the U.S. Supreme Court's 2008 decision in D.C. v. Heller.

Lawyers for Dick Heller, a name party in the earlier case, filed a notice Thursday that they will continue fighting in this follow-up case. They are appealing to the U.S. Court of Appeals for the D.C. Circuit to reverse a March 26 decision by U.S. District Judge Ricardo Urbina. That ruling upheld new restrictions the D.C. Council passed in the wake of the 2008 decision. For example, all handguns must be submitted to D.C. police for a ballistics identification process.

Stephen Halbrook, a lawyer for Heller, said a week ago that an appeal of Urbina’s decision was likely because, he said, the judge was overly deferential toward the city. Lawyers for the District say the council worked to strike a balance between Second Amendment rights and public safety concerns.

The original Heller case, then known as Parker v. D.C., also went through the D.C. Circuit. In a March 2007 decision, Senior Judge Laurence Silberman wrote that Heller had standing to challenge the District’s gun laws and that the laws in place at the time were unconstitutional. Heller, of course, won before the Supreme Court in a decision that said the Second Amendment protects an individual right to bear arms.

As discovery heats up in the Federal Trade Commission's monopolization lawsuit against Intel Corp., at least seven tech giants have been dragged into the fray.

Microsoft, Oracle, Hewlett-Packard, Via Technologies, Lenovo, Acer and Gateway have all been hit with subpoenas for documents either by the FTC, Intel, or both. Lawyers for the companies have responded with motions asking for more time to comply or to quash or limit the scope of the requests.

The FTC on Dec. 16 charged Intel with using its dominant market position to illegally stifle competition in violation of Section 5 of the FTC Act. Trial is set for September.

According to papers filed with the agency, Microsoft is represented by Jonathan Kanter and Amy Ray of Cadwalader, Wickersham & Taft. Intel’s subpoena includes 33 requests for production of documents from Microsoft.

A Washington-based antitrust partner, Kanter previously worked at the FTC in the Bureau of Competition. Ray is an associate.

Oracle has been hit with multiple document requests – one from Intel seeking Oracle papers, another asking for documents from Sun Microsystems, which was acquired by Oracle earlier this year.

The Intel subpoena contains 43 specifications for relevant documents from Oracle and 36 specifications for Sun, according to court papers. In addition, the FTC subpoena includes 23 document production requests.

Oracle has retained Hogan & Hartson partners Clay James and Joseph Krauss. Prior to joining Hogan in Denver in 2009, James was the chief litigation counsel for Sun Microsystems. Krauss, who is based in Washington, spent 11 years at the FTC before moving to Hogan in 1999.

Via Technologies faces a subpoena from Intel with 57 specifications and seven pages of definitions. Via has retained David Gelfand, Patricia McDermott, and Daniel Culley of Cleary Gottlieb Steen & Hamilton. Gelfand is a Washington-based antitrust partner, McDermott is a senior attorney, and Culley is an associate.

The FTC wants information from Lenovo Group, issuing a subpoena with 21 specifications. The Chinese computer technology company is represented by W. Andrew Copenhaver of Womble, Carlyle, Sandridge & Rice. An experienced trial attorney, the Winston-Salem based partner specializes in antitrust.

Jonathan Beckham and Noel Gordon have left London-based Webster Dixon to join Gray Haile. Beckham will be based in Washington while Gordon will open an office in Philadelphia. They both join as partners.

Beckham and Gordon advise clients on mergers and acquisitions, joint ventures, private equity, commercial, procurement and compliance matters. Their past clients include Tyco International, Tata Communications International, Glaxo SmithKline, the Main One Cable Company and Teleglobe International Holdings Ltd.

Beckham and Gordon were based in Washington and Philadelphia respectively at Webster Dixon, which had not had a U.S. presence prior to their joining. At Gray Haile, they will advise middle-market clients on M&A deals.

Beckham has previously been counsel to Baker & McKenzie and O’Melveny & Myers. He has also worked in-house at Tata Communications and Teleglobe Holdings. Gordon, whose Big Law experience includes time at Baker & McKenzie and Reed Smith, worked in-house at Glaxo SmithKline as senior counsel and global procurement director. He also served as an assistant U.S. attorney under then-U.S. Attorney Eric Holder Jr. in Washington.

Managing partner Leander Gray said the addition of Beckham and Gordon allows Gray Haile to have more lawyers available to work on client matters. Gray Haile had five lawyers before adding Beckham and Gordon. "From a practical perspective, we wanted to have the capability of handling matters and not kiling ourselves if someone went out of town."

Gray said the firm seeks to focus on M&A deals that involve assets of $100 million or less, which he says can be handled more efficiently by a smaller firm. "That's where most of the deals tend to fall, and you don't need teams of lawyers to do that kind of work," Gray said. "So we're carving out that niche, and our clients appreciate that."

A federal appeals court in Washington today struck down a 30-year ban on any computer use by a convicted sex offender, sending the case back to the trial court to refine the restriction in a way that opens it up to modification for work purposes.

The defendant, Mark Russell, had pleaded guilty in federal district court to one count of traveling to engage in unlawful sexual conduct. He was sentenced to 46 months in prison and 30 years of supervised release. During his release, Russell is forbidden from possessing or using a computer for any reason.

A three-judge panel of the U.S. Court of Appeals for the D.C. Circuit said on Friday the outright ban on computer use is unreasonable. The court, however, affirmed Russell’s 30-year term of supervision.

Russell, a former applied systems engineer at Johns Hopkins University, chatted with a 13-year-old girl—in reality the “girl” was a D.C. cop—in an Internet chat room in June 2006. Russell, who lived in Columbia, Md., drove to the girl’s house, parked and e-mailed her to announce his arrival. He waited for a bit before driving away. The police arrested him as he was leaving.

Assistant Public Defender Tony Axam Jr. argued for Russell in January at the D.C. Circuit. Assistant U.S. Attorney Peter Smith represented the government. Smith conceded the 30-year outright ban on computer use should be revised.

“[T]he question is not the appropriateness of an internet restriction but its form and severity,” wrote Senior Judge Stephen Williams in the majority opinion. Williams was joined by Judge David Tatel.

Williams said it’s difficult to imagine white collar work not requiring access to computers “just as white collar work 100 years ago would almost invariably have required the use of pens and pencils. In fact Russell’s training and experience mark him not only as a white collar worker but as one at the most technically sophisticated end of the white collar distribution.”

The judge noted that even some blue collar work requires a computer: Russell “has evidently found that computer use is required for filling out most job applications, including those at McDonald’s, as well as discharging the duties of even low tech occupations, such as keeping inventory at PETCO, and producing frames at A.C. Moore.”

A “minimum change” on remand, the court said, would allow a probation officer to modify the outright ban to adjust to developments in technology and “to secure a reasonable balance between the statute’s rehabilitative and deterrence goals.”

Judge Karen LeCraft Henderson agreed with remanding the ban to the trial court for further review. But she rejected the notion, reflected in the majority opinion, that a ban on computer use is a “substantial burden” on a person’s liberty interest.

“We can judicially note that millions of Americans every day perform jobs without using (or even seeing) a computer,” Henderson wrote in a concurrence. “If Russell cannot find a job, it is more likely because of his criminal record than the computer ban.”

Patent lawyer Anthony Son has jumped from Connolly Bove Lodge & Hutz to Wiley Rein as a partner in Washington.

Son, 37, has represented a range of clients in patent disputes, including electronic, automotive and pharmaceutical companies. However, his practice has focused primarily on the financial services industry in the past five years, including cases involving Zions Bank and U.S. Bank.

He said most of the latter cases involved Internet technology.

Son, who earned his J.D. from Yeshiva University Benjamin N. Cardozo School of Law, also previously was a partner at Foley & Lardner, prior to joining Connolly Bove’s Washington office in May 2009.

Wiley Rein's gross revenue grew 1 percent in 2009, from $198 million to $200 million, and profits per equity partner rose 1.6 percent, from $950,000 to $965,000, according to this year’s Am Law 100 survey.

Facebook Flap: The social networking site Facebook could soon find itself in federal court in Philadelphia defending against claims of patent infringement, the Legal Intelligencer reports. The plaintiff, Cross Atlantic Capital Partners, also known as XACP, claims it holds the rights to a patent for an Internet-based "community for users with common interests to interact in" that was invented in 2000, four years before Facebook was launched.

Protected Notes: A federal appeals court ruled Thursday the attorney-client privilege protects handwritten notes and memorandums that Sidley Austin wrote during an investigation of alleged sexual abuse by a music teacher. The National Law Journal story is here. The U.S. Court of Appeals for the 7th Circuit ruled the notes and memos are protected even though the lawyers who prepared the material were not handling the lawsuit that sparked the investigation.

KBR, Under Fire: The Justice Department yesterday filed suit against defense contractor Kellogg, Brown & Root that alleges the company filed false statements in billing the government for private armed security guards in violation of a contract with the Army. The Washington Post has the story here and The BLT here.

Welcome to Topeka, John: No, Google didn't really rename itself "Topeka" and The Johns Hopkins University, in Baltimore, isn't dropping the "s" from Johns. (Explanation of the name "Johns" here.) April Fools' day has come and gone. Stories here, here and here on the day's made-up news.

April 01, 2010

The Justice Department today filed suit against defense contractor Kellogg, Brown & Root in federal district court in Washington, alleging the company improperly billed the government for armed security guards.

The complaint alleges that Houston-based KBR violated the False Claims Act through certain billings made to the Army under the company’s Logistics Civil Augmentation Program III contract. The contract, according to the Justice Department’s complaint, covers services that include food, transportation and laundry for military operations in Iraq. The complaint does not identify a dollar amount loss to the taxpayers. The 13-page complaint alleges, among other things, unjust enrichment and breach of contract.

KBR did not obtain military authorization for the company and its subcontractors to carry firearms, according to the complaint. “Despite these restrictions and the lack of authority, KBR awarded subcontracts to three private security companies to provide armed personal security details for its executives and awarded additional subcontracts to more than 30 other companies that employed their own private armed security,” the complaint says.

“Defense contractors cannot ignore their contractual obligations to the military and pass along improper charges to the United States,” Assistant Attorney General Tony West of the Civil Division said in a statement. “We are committed to ensuring that the Department of Defense’s rules are enforced and that funds so vital to the war effort are not misused.”

A message left with Sharon Stagg, senior in-house counsel at KBR, was not immediately returned this evening. The law firm Susman Godfrey is representing KBR in the suit.

KBR issued a statement today that said, in part: "Since 2001, KBR and its employees and subcontractors have worked diligently, and at often times at great sacrifice, to support American troops serving in Iraq. KBR believes the costs incurred and actions taken by the company and its subcontractors to provide support and to protect its employees and subcontractors were reasonable, necessary and appropriate under the contractual arrangement between KBR and the Army."

The statement said the Army has improperly refused to pay KBR expenses for security. A dispute between KBR and the Army is pending before the Armed Services Board of Contract Appeals, according to the statement. "The government’s recent filing of a new complaint in another forum appears to be an attempt to avoid a decision in that proceeding," the statement said.

The American Small Business League filed a motion for a preliminary injunction on Wednesday against the U.S. General Services Administration to restore recently removed aspects of a database used to monitor federal contracts.

In the motion filed in the U.S. District Court for the Northern District of California, the league objected to the removal of two identifying fields from the searchable Federal Procurement Data System – Next Generation. One of the fields identified small businesses, and the other field identified the names of contract recipients.

The system, the government's electronic database for federal contracting data, is used by federal agencies, watchdogs and the general public to oversee the procurement process, according to the motion. Agencies are required to report all contracts worth more than $3,000, as well as subsequent modifications.

The General Services Administration ordered these two changes on March 12. The league originally filed its lawsuit, American Small Business League v. Martha N. Johnson, on March 8 in preparation for the changes. Johnson serves as administrator of the GSA.

The league argues that the data removal violates the transparency standards articulated in the Federal Procurement Policy Act of 1974. It argues that the information at issue must be immediately restored to the publicly accessible database because the lack of access creates an “irreplaceable harm,” adding that the information “has been used in the past to identity instances where contracts set aside for small businesses were awarded to Fortune 500 corporations.”

The league estimates that $1 trillion worth of contracts intended for small business have gone to big businesses in the past decade, according to a Wednesday news release.

A nonpartisan advocacy group formed in 2004, the league is represented by Robert Belshaw, of counsel to Gutierrez & Associates in San Francisco.